CHICAGO, Sept. 11, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Goldman Sachs (GS) was recently featured in the blog.
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Here are the highlights from Zacks Analyst Blog about Goldman Sachs and Carlyle Group LP:
The Goldman Sachs Group Inc. (GS) came up with the decision to divest its North Carolina-based Cogentrix Energy LLC, the power plant development unit, to Carlyle Infrastructure Partners, the infrastructure fund of The Carlyle Group LP (CG). Financial terms of the deal, which is anticipated to be closed in the fourth quarter of 2012, remained undisclosed.
Under the terms of the deal, Carlyle Group will receive admittance to three oal-fired and two solar power plants in Florida, Virginia, Colorado and California, along with a development pipeline with over 550 megawatts (MW) of operational capacity. However, Goldman Sachs will hold a minority stake in one of the power plants.
With such an investment, Carlyle Group aims to acquire significant market share in the energy business. Carlyle Group will finance the deal with the help of infrastructural fund of $1.14 billion.
In 2003, Goldman Sachs purchased Cogentrix for $115 million and took over $2.3 billion in debt. Since then, Cogentrix has acquired 26 coal- and natural-gas-fired power plants. However, after the acquisition in the last decade, Goldman Sachs vended most of the plants in order to reap financial benefits from the proceedings of the sale. Moreover, through the sales, Goldman Sachs aims to maximize the value of the remaining assets and receive commercial benefits.
Other commodity sector investments of Goldman Sachs include U.S. metals warehousing firm Metro International bought in 2010, and earlier in 2012, Goldman Sachs paid about $400 million to acquire Colombian coal mine assets from Brazil-based Vale S.A. (VALE).
With the investment in the energy business, Carlyle Group strategizes to expand in a significant segment of the global economy. Working with the diligent development team of Cogentrix, Carlyle Group will be able to enhance its investment capabilities. Moreover, with such initiatives, development of conventional and renewable power projects across the U.S. is expected.
Goldman Sachs (GS) currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. Considering the fundamentals, we also maintain a long-term 'Neutral' recommendation on the stock.
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